Question 7 - How do your auditors tie up reserves to cash generating units?

This is the seventh question in the list of ten questions to ask your auditor if you are a Canadian based oil and gas company. The original post can be found here.

How do your auditors tie up reserves to cash generating units?

This is important as companies move forward with IFRS. As an oil and gas company, you have to be able to identify where your revenue is coming from at a cash generating unit. Since an oil and gas companies future revenues come from their reserves, if you can not tie reserves to cash generating units, then how do you authenticate revenue?

These opinions are mine and may not reflect your view. If you would like to contact me, then please feel free to do so at info@argentis-group.com. Argentis Group assists oil and gas companies with operational audits to identify areas to reduce costs, increase revenues and increase the overall asset value of an oil and gas company. If you would like to find out how to tie up reserves to a cash generating unit, then please contact us.